Doximity Inc, a company known for its online networking services catering to medical professionals, released its financial results for the third quarter of fiscal year 2026 on Thursday after the market closed. Despite modestly surpassing revenue and adjusted earnings estimates for the period, the company’s outlook for upcoming quarters has sent its stock price sharply lower in extended trading.
For the quarter ended December 31, 2025, Doximity reported revenue of $185.05 million, slightly above consensus estimates of $182.20 million as tracked by Benzinga Pro. This reflected a 10% increase compared to the same quarter in the prior fiscal year, indicating steady top-line growth within its core business segments.
Adjusted earnings per share (EPS) also narrowly outpaced expectations. The company posted 46 cents per share, just over the predicted 45 cents, signaling effective cost management amid increasing investments, particularly in new product initiatives.
CEO Jeff Tangney commented on the company’s expanding product footprint, highlighting milestones in user engagement across its platforms. He noted that its newsfeed service attracted over one million quarterly active prescribers, while workflow products saw a quarter-over-quarter record jump, reaching 720,000 users. Furthermore, its emerging artificial intelligence (AI) applications engaged more than 300,000 users, underlining the company’s strategic push to integrate AI features across its offerings, which management believes enhances platform utility for health professionals.
Despite these positive operational indicators, Doximity’s guidance issued alongside the report has unsettled the market. For the fourth quarter, the company anticipates revenue between $143 million and $144 million, notably below analyst estimates of approximately $150.23 million. This expected shortfall in revenue has raised concerns regarding growth momentum in the near term.
Adjusting its full-year revenue projections for fiscal 2026, Doximity narrowed its guidance range from an earlier $640 million to $646 million to a tighter band of $642.5 million to $643.5 million. Although this revision still suggests marginal growth, the reduced upper bound could imply more conservative expectations amid evolving market conditions.
In a strategic move to potentially support shareholder value, the company’s board authorized a share repurchase program of up to $500 million in its common stock. As of the end of December 2025, Doximity reported cash and cash equivalents totaling nearly $64.84 million, indicating a solid liquidity position to support these repurchases or other operational requirements.
Following the earnings announcement, Doximity’s shares plunged sharply during after-hours trading on Thursday, with a decline exceeding 33% and the stock trading at $22.25 at the time of publication, according to market data from Benzinga Pro.
The considerable drop in share price reflects investor reaction to the lowered revenue outlook, overshadowing the recent quarterly beat and strong engagement metrics. Investors appear wary of potential headwinds as the company navigates future growth and its strategic initiatives in AI and workflow tools.
Doximity executives plan to further elaborate on the quarter’s performance and outlook in a scheduled earnings call later on Thursday at 5 p.m. Eastern Time, which may provide additional context on the company’s financial positioning and growth strategy.